PRIME EXPORTS: Made-in-China intercity bullet trains are put into use in Buenos Aires, capital of Argentina, on July 22 (JIANG CHAO)

Cheaper Houses

China's home prices continued on a downward trend in more cities in June, according to official data released on July 18.

New home prices in 55 of a sample of 70 major cities showed month-on-month drops in June, contrasted with 35 in May, the National Bureau of Statistics (NBS) said in a statement.

Only eight cities saw month-on-month gains, down from 15 in the month earlier.

The average home price in the 70 cities slipped 0.47 percent from the previous month, more than the 0.15-percent fall in May, according to the NBS data.

However, on a year-on-year basis, home prices in most cities are higher than a year ago, with only Wenzhou in Zhejiang Province seeing a price drop in June.

Against this backdrop, some local governments are rushing to relax curbs on home purchases, as sluggish property sales undercut local fiscal revenue.

Bank Cooperation

On July 18, the central banks of Venezuela and China signed a cooperative agreement in Caracas, capital of the South American country, aimed at promoting the exchange of information on statistical methodologies, monetary policy strategies and funding mechanisms between the two countries.

Zhou Xiaochuan, Governor of the People's Bank of China, said the agreement is a breakthrough for both sides in enhancing economic ties.

It is important for the two central banks to exchange views and share their experiences, especially on monetary policies and financial stability, Zhou added.

Zhou's Venezuelan counterpart, Nelson Merentes, described the deal as "historic," saying it would facilitate bilateral collaboration.

Merentes stressed that the two central banks have to work together as the ties between the two countries are getting ever closer.

He said that it must be taken into consideration that "more and more Chinese companies" are investing in Venezuela in various fields, such as agriculture, livestock, construction, mining and telecommunications.

Local Bailout

The possible second bond default in China was avoided after the local government of north China's Shanxi Province decided to help the troubled Huatong Group.

On July 16, the private construction company claimed that it faced "uncertainties" in paying back the principal and interest of its 400-million-yuan ($64-million) note.

The one-year note, recently revised down by domestic rating agencies to B from A-1, was due on July 23 with an annual interest rate of 7.3 percent.

However, sources close to the bond's underwriters said enough funds were available to cover the principal and interest of the one-year commercial paper, totaling 429.2 million yuan ($69 million).

Governments at different levels in Shanxi have lent 595 million yuan ($96 million) to the company, according to The 21st Century Business Herald, a business newspaper published in Guangzhou, Guangdong Province.

The possibility of a default emerged after the company's Board Chairman, Wang Guorui, was put under investigation for allegedly breaking the law in mid-July.

In early March, Shanghai Chaori Solar Energy Science & Technology failed to cover 89.8 million yuan ($15 million) in interest payments, making it the first onshore bond default and causing a minor panic among investors.

Authorities have signaled since late last year that they would tolerate defaults as long as such incidents do not bring systemic risks to the country's financial systems.

Companies have long relied on local governments and state-backed lenders for last-minute bailouts to help meet their obligations when they run into liquidity problems.

Such bailouts have been criticized for causing distortions in the market and preventing investors from getting a clear look at the risks they are exposed to.